The Indian Dolutegravir market levelled off in December, with year-end inventory adjustments causing buyers to slow down new orders and focus on sorting out their existing stock. After the second week of December ended, demand dropped off, which was really no surprise given all the caution in the market- it's not like there were any supply chain problems. Factories continued running at a steady pace, meaning there was still plenty of Dolutegravir floating around and no real fear of shortages. With stable production costs and good access to the basic materials needed, there wasn't even any possibility of prices shooting up. Exporting Dolutegravir also slowed down towards the end of the year, with overseas buyers deciding to put any new orders on hold until the new year. All this added up to a downbeat market that's just plain not going anywhere fast. And now in January, market experts are not expecting things to get much better, which is hardly a shock given that the quarter just gone left distributors with a whole lot of inventory to get through. And as long as the manufacturers are still offering competitive prices and keep their costs steady, it looks like prices are going to keep on getting cheaper until our buyers get back to buying it in larger quantities later in the quarter.
The market for Dolutegravir appears to have stabilized after seeing a decrease in demand at year's end due to companies adjusting their inventories. The Dolutegravir market also experienced a slowdown in trading activity during the second week in December as companies began to optimize their inventory levels, which indicates that this is a seasonal trend, and not an indication of a major change in the fundamentals of the business.
Market participants observed that as the year ended, many distributors and formulators were managing their inventories, leading to softer demand for Dolutegravir. Because these companies had adequate amounts of Dolutegravir from previous purchases, they have significantly reduced their interest in spot purchases and have chosen to delay their forward purchasing commitments.
As a result, Dolutegravir prices have stabilized, and although they have been less volatile than in previous weeks, production economics have remained unchanged. There has been no change to the overall availability of Dolutegravir from the production side; however, the rate of production by manufacturers has been steady, and they are not increasing their output levels, but are aligning their production capabilities with the current demand.
The same trend was also true for export inquiries, as overseas buyers were primarily focused on inventory management as well, and most had opted to wait to place new orders until after the New Year. The decline in export inquiries contributed to the stabilization of the Dolutegravir market and limited the use of aggressive selling strategies by suppliers to sell their products in the export markets.
Cost-wise, Dolutegravir production costs have remained steady due to there being an adequate supply of raw materials as well as efficient delivery systems in place. No inflation on the cost side of the equation means a lack of justification for the manufacturers to be firm on pricing. As a result of this uncertainty, manufacturers were being conservative and attempting to balance their need to support profit margins as opposed to having to face slower sales of Dolutegravir during the holiday season. Market perceptions of Dolutegravir in India have turned toward cautiousness but are orderly. Individuals involved as purchasers were only looking to procure enough Dolutegravir solely to meet essential needs, and all manufacturers were concentrated on managing their existing inventories instead of going after any additional demand for the product. This situation created a steady to soft tone of the market in terms of Dolutegravir through mid-December without any major swing activity in Dolutegravir transactions.
The market participants of Dolutegravir have a view of the market remaining under pressure for the early part of the upcoming new year. The experts have stated that the downward movement of prices will continue through January because of the caution of the buyers after the holiday season. In addition, the high levels of inventory carried over from the last quarter will create a lack of urgency for new orders to be placed at this time. The manufacturers will likely utilize competitive pricing to generate new orders for Dolutegravir, while raw material prices will remain constant, and thus, cost pressures will be contained.
